I will start this publication giving some concise data ...

In Venezuela you can buy 9510 gallons of gasoline for 1 US dollar, but the average monthly salary in Venezuela is US $ 6 before taxes and discounts. A citizen can buy approximately 4kg of pasta (spaghetti) with the same amount of money that he would buy 57060 gallons of gasoline.

These low prices are the result of the subsidy that the government has on the sale price. How does it work? Well, the Venezuelan state oil company, PDVSA, is in charge of distributing gasoline to the fillings stations where it is sold to the citizens, later the owners of the fillings stations are in charge of transferring an invoice to PDVSA, so that PDVSA ultimately pays to fillings stations for commercial margin concepts, in this way citizens can buy gasoline at a ridiculously cheap price and the owners of fillings stations receive profits for lending their facilities to distribute the fuel, and all this is possible thanks to the fact that Venezuela's subsoil contains the largest oil reserves in the world.

For decades the system has been practically the same, Venezuelans have been paying virtually nothing for fuel, the only time a politician tried to raise the price of gasoline was ending the decade of the eighties, and did not end well, protests and repression broke out in the streets of Caracas, capital of Venezuela, however, the socialist government of Venezuela decided to raise the price of gasoline 6,000% in the midst of the current crisis that the country suffers, but even so it remained the gasoline most cheap of the world.

As I said, the fuel subsidy system remained in operation for decades without any problems, however, at present, the government has had to limit the sale of gasoline to 9.24 gallons per automobile and 1.32 gallons per motorcycle in several states of the country.

Message from a Venezuelan about the situation of gasoline:

In order to better appreciate the abysmal subsidy that exists on the price of gasoline in Venezuela, we will put in context that the price of gasoline in the United States, which is between a range of 2.25 to 2.85 dollars per gallon , and in Norway, for example, the price of gasoline is approximately $ 2 per gallon.

Sources: @TruthForce y @Scandinavianlife.

In the United States you can buy 9510 gallons of gasoline for approximately $ 23,775, while in Norway you can buy for 19,020. Interesting is to understand that in the middle of the crisis that Venezuela currently suffers, citizens could acquire for a single dollar, that same amount of gasoline. That level of economic distortion can only be found in countries where the market is totally subordinated to the power of a State.

Many analysts and economists tend to say that it is necessary to eliminate the gasoline subsidy in order to stabilize the national economy and thus open prices in the market, as well as greatly reduce the current deficit of PDVSA and the government, however , I think they are forgetting the first and maximum problem of eliminating the gasoline subsidy, and that is that there is no way to establish a correct price if there is a monopoly, because a market that does not have the information provided by the price system and the competition lacks the power of self-regulation.

So what can a nation do in these circumstances?

Having gasoline at low prices is not a bad thing per se, however, selling gasoline at a price artificially lower than the operating cost is a big problem, because it generates a deficit that has to be paid by someone, in this case, the cost is assumed by the oil company, but when inflation increases and the price of the gasoline remains frozen, it is inevitable that the deficit will increase, which will end up leading to indebtedness and later to bankruptcy. If the company goes bankrupt, everyone runs out of gasoline, and it would be irrational if there are resources, machinery and qualified people to produce, distribute and sell the product, simply because the State wishes to arbitrarily maintain an artificial price, with the objective of subsidizing a class of "privileged" people, after all, not all citizens have to fill a tank.

The only possible solution is to eliminate the monopoly and allow different companies to compete with each other, with the aim that the price systems can work properly, and that consumers can benefit from the product to the extent estimated by supply and demand . Some of you may wonder how to eliminate a monopoly, well, there is only one way, and that is to remove the privileges established by the State.

Conclusion

In Venezuela the cost to fill the gas tank is extremely low, however, everything that citizens stop paying directly, end up paying indirectly much more expensive (My grandfather used to say: "cheap is expensive"). Tens of thousands of millions of dollars are constantly looted from the nation, since low costs favor the smuggling of gasoline, in addition, by not having a price system, you can not honestly establish the price of a product, under the commercial logic in this scenario the monopolist company would abuse its power and exploit the market for its own benefit, however, being this a state company, decides to do the exact opposite, and continue the process to the detriment of the production system. In conclusion, the only way for an economy to function in a healthy way is through competition and the free market, any way of exercising central control over economic factors will inevitably lead to failure. In this case, low-cost gasoline translates as a misuse of non-renewable natural resources.